Experience with Public Regulation of Monopolies Indicates That

Experience with public regulation of monopolies indicates that

A) on the average, regulated prices are clearly lower than unregulated prices of the same item.
B) regulation provides a stronger set of incentives than competitive markets for firms to increase efficiency.
C) a decision to base a fair rate of return on either historical cost or replacement cost yields the same pricing result.
D) most public utility regulation should be in the hands of federal rather than state commissions.
E) if a firm is guaranteed a fixed amount of profit, it will be less efficient than if its profits depend on how efficiently it operates.

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